The US Senate passed legislation this week, aimed at countering China’s tech sector. But one important measure was excluded from the so-called China Bill – the Inform Consumers Act.
The Inform Act would have forced companies like Amazon, eBay and Etsy to verify the identity of sellers on their marketplaces. By stripping merchants of their anonymity, the act would have helped protect consumers from stolen, fake or dangerous products.
But, despite cross-party support, and the huge numbers of Chinese businesses selling on Amazon and other marketplaces, the Inform Act had gone missing from the China Bill that was passed by the Senate.
This followed aggressive lobbying by multiple marketplaces including Amazon, eBay, Etsy and others. These marketplaces make a lot of noise about trust and safety, so why did they want to kill a bill that would enhance exactly that?
Amazon defeats consumer protection bill
One way that the marketplaces lobbied against the bill was a classic political ploy: creating a group that looks and sounds like a grassroots organization. In March, eBay, Etsy, Mercari, OfferUp and Poshmark created the Coalition to Protect America’s Small Sellers (the PASS Coalition). The main cause that the group supports is to fight the Inform Consumers Act.
As part of this, the PASS Coalition pointed to another group, The Buy Safe America Coalition, which has support from dozens of conventional retailers and brands such as Lowe’s, Walgreens, Levi Strauss and GSK. The Buy Safe America Coalition was a key supporter of the Inform Act.
Even after the Inform Act was amended so that sellers’ identities would only be disclosed after a sale was completed, the PASS Coalition objected on the grounds of privacy. Apparently, the marketplaces think that people should be expected to shop online, and expose their own private information in order to make a purchase, without the right to know who they are actually buying from.
Who wins in all this? Is it the Buy Safe America Coalition, set up by the big brands and established retailers, or the Coalition to Protect America’s Small Sellers, set up by the big tech companies?
Actually, two groups benefit from this whole cynical game: the marketplaces who don’t want to do any additional work to vet their sellers, and the people who want to sell on those marketplaces using fake identities.
Genuine sellers lose nothing from the simple requirement to prove their identity, and tell their customers who they are, but they do suffer greatly from the abuse of black hat sellers as discussed in detail this week by Chris McCabe.
Would higher standards of vetting help weed out the scammers, counterfeiters and other bad actors? Surely it would keep out some of them, and help take action against those that remain.
Like so much of big tech, the marketplaces have successfully avoided legal regulation, for now. Sellers will just have to keep on trusting the marketplaces to police themselves.
Read more at The Washington Post.
Other marketplace news
Amazon ad costs are up 50% in one year
Research by Marketplace Pulse has found that advertising on Amazon now costs $1.20 per click on average, an increase of 50% compared to last year.
In 2020, the average cost per click was $0.85. It fell to $0.75 at the height of the pandemic in May then hit its highest levels for the year on sale days and in December.
The average “advertising cost of sale” – the proportion of a product’s price that was spent on ads – has now risen to over 30%. Marketplace Pulse says it takes eight clicks to generate one sale, giving an average ad spend per product of nearly $10.
Advertising costs have changed very similarly on Amazon markets in Europe and Japan.
Read more at Marketplace Pulse.
eBay starts authenticating handbags
eBay has extended its Authenticity Guarantee service to include used handbags sold for more than $500 from 16 prominent luxury brands, including Saint Laurent, Gucci, Celine and Balenciaga.
All eligible handbags sold in the U.S. will be authenticated by eBay’s team of authenticators, using a manual examination and “technical equipment”. Buyers can shop for handbags with the authenticity guarantee on a special eBay page.
Charis Márquez, VP of Fashion at eBay, said:
Authenticity Guarantee has changed the way people buy and sell luxury items on eBay. There’s a handbag bought every 12 seconds on our marketplace, and now we’re expanding authentication to deliver an additional layer of trust and confidence for these shoppers and sellers.
Read more at eBay Inc.
Alibaba wants pitches from SMBs
Chinese internet giant Alibaba is inviting small and medium-sized businesses in the US, UK and Ireland to apply for the catchily-named Tmall Global Go Global 11.11 Pitch Fest.
The event will see brands pitching their products to the Tmall Global team, and receiving advice on expanding their businesses into China. The winners will get a fast-track launch on Tmall Global, Alibaba’s marketplace for Chinese shoppers to buy from foreign brands.
The company says that US businesses sold over $54 billion of products to Chinese consumers via Alibaba’s platforms in 2020, and Tmall Global has helped thousands of US brands sell to hundreds of millions of Chinese consumers since its launch in 2014.
More than 100 US brands have launched on Tmall Global so far in 2021, along with 40 brands from the UK and Ireland. Separate pitching events will be run for the US, and for the UK and Ireland.
Read more at Alizila.
Walmart and Target gear up for… Amazon Prime Day
Despite the animosity between the conventional retail industry and Amazon, the big retailers are not above running their own sale events to compete with Prime Day.
In a stunning display of unoriginality, Walmart will run “Deals for Days” from June 20-23, while Target is planning “Deal Days” to run from June 20-22.
Walmart’s event will include online and in-store deals on TVs, laptops, phones and smartwatches. Target’s sale appears to be an online-only affair, with discounts offered on electronics, home essentials, beauty items, toys and groceries.
We are waiting to hear when Kroger will run their event, presumably called “Dealy Day Deals for Daily Deals Day”.
Webinars coming up
June 15: eBay Shareholder Meeting 2021 (eBay).
June 23: I Sold My Amazon Business (Prosper Show).
June 24: eBay Monthly Seller Check-In (eBay).
Various dates: Amazon advertising’s global webinar program rolls on with 20+ webinars scheduled, covering Sponsored Products, Sponsored Brands, reporting, optimization and tips (Amazon).
For US sellers
June 15: Prime Day Pricing, Fulfillment and Advertising Strategies (ChannelAdvisor).
June 16: Amazon FAQs: Ask The Experts (eComEngine).
For UK sellers
June 14: Understanding Restock Limits and Inventory Performance Index (Amazon).
June 15: Sell more easily in Europe with Cdiscount Fulfilment (Cdiscount).
Alleged pipe bomber sues eBay for racketeering
A Massachusetts man who was previously charged with attempting to blow up power lines running from Canada to the US, but ruled incompetent to stand trial on mental health grounds, is now suing eBay under the Racketeer Influenced and Corrupt Organizations act.
The plaintiff, Danny M. Kelly, alleges that eBay’s money-back guarantee is fraudulent as the company will not reimburse the buyer if the carrier tracking information shows that the order was delivered within their zip code.
An excerpt of the complaint reads:
eBay ignores the issue that the package was not addressed to the Buyer/receiver. The refusal of ebay to consider the actually [sic] addressee or even the size of the package has created a situation that not only allows sellers to steal from buyers but prevents the buyer from being able to get a refund from the shipping company.
In 2017, Kelly was ordered into the custody of a psychiatric hospital, following a brush fire near power lines that officials suspected was caused by an incendiary device. A note was found attached to one of the power line poles, taking credit for the incident and threatening future attacks. The FBI swiftly traced it back to Kelly, who had been convicted in 2005 for previous attacks on telephone and cable lines.
According to an FBI affidavit, Kelly bought the chemicals for the (alleged) 2017 attack from… you’ve guessed it, eBay. The orders included 20 pounds of iron oxide and 5 pounds of aluminum powder, suitable for creating the incendiary composition thermite.
So, a man with a history of buying explosive chemicals from eBay, and of blowing up infrastructure, is now suing eBay because he did not receive his latest purchases. What was he buying this time?!
Kelly, perhaps unsurprisingly, is representing himself in the case against eBay.